Bankers on the Federal Reserve board are appointed by presidents and approved by the Senate. And they are not dictators or even real planners, their decisions are broad, general goals, and bear little resemblance to planning.
Its failures do not reflect on its necessity any more than the failures of the Congress reflect on it. It is part of capitalist development not easily served by other features or these banks would have never succeeded to the extent they have.
Servicing the national debt is a major reason it exists. It owns about one third of our national debt. All profits are turned over to the US Treasury, about 35 billion a year.
Loans to member banks do stabilize the economy by nipping runs in the bud and stopping those which have started.
One of the characteristics of a capitalistic economy is its transformation and evolution to higher stages. This is the reason there is a federal reserve. Not a vague conspiracy theory which doesn’t even make sense on its face.
The Bank attempts to maintain a certain value for the dollar and inflation represents a failure of that intention. We need all the weapons possible to address multiple economic issues.
Now it is true that some of the Fed’s powers were not foreseen by its creators and some revision might be necessary but I don’t know it there are any people intelligent enough to try.
Almost every one of your comments is what I have heard referred to as a “though-terminating cliche.” In sum: central banks are necessary because they are so important, and because they are so important they are successful.
You’ve proven nothing IMHO
“their decisions are broad, general goals, and bear little resemblance to planning” - they don’t target inflation? “Maximum employment?” They don’t try to manage long and short term rates?
“Servicing the national debt is a major reason it exists. It owns about one third of our national debt.” In fact, the Fed was established in 1913 to provide short-term liquidity, at punitive rates, on high quality bills of credit to member banks. Nothing about buying Federal debt. In fact, the Fed was once prohibited from doing so. Who gave it the mandate to print money to buy up $trillions in Government debt? That’s quite a difference. Can you tell me the long-term effects of that?
When the Fed starts buying stocks in the next “crisis” - which Yellen has said is within her “toolbox” - can you tell me which stocks they should buy? How much? And when they become the largest shareholders in most industrial companies (as has happened in Japan with their central bank) what then?
“Loans to member banks do stabilize the economy by nipping runs in the bud and stopping those which have started.” Oh really? $2 Trillion in excess reserves on bank balance sheets is the requirement for stability? Did the Fed have any responsibility for actually causing these excesses in the 1920’s, or the tech bubble? In the 2000’s housing bubble?
“One of the characteristics of a capitalistic economy is its transformation and evolution to higher stages. This is the reason there is a federal reserve.” I have no idea what you are talking about. Marx talked about historical materialism and the teleological ends of history - is that what you mean?
“Now it is true that some of the Fed’s powers were not foreseen by its creators and some revision might be necessary but I don’t know it there are any people intelligent enough to try.” Here you’ve fully contradicted yourself. The many roles of the present Fed were not foreseen by its creators - and we can’t revise it, because no one is intelligent enough to do so. BUT - the present group Board of Governors and FOMC ARE intelligent enough to know exactly what their present role is, how much QE to do, what the proper level of bank reserves are, or exactly what the prime rate should be?
The Fed, in the last 8 years, has simply succeeded in propping up its member banks and their extreme excesses, as well has Fed.gov spending, through thievery of workers wages and savings.
Central Banks aren’t needed in a truly free-market economy and the USA didn’t have one for much of its existence as a nation. The present power of global central banks is unprecedented. Even simple check clearing can be conducted among banks themselves.